Introduction

The Supreme Court of Colorado, in HEWITT v. RICE, 154 P.3d 408 (2007), addressed pivotal questions regarding the tort of malicious prosecution, specifically in the context of lis pendens filings. The case originated from a protracted legal dispute between William W. Hewitt and Valley Park Apartments, Inc. ("VPA") against Thomas S. Rice, Brian R. Reynolds, and the law firm Senter, Goldfarb Rice, LLC ("the Firm"). Hewitt alleged that the Firm maliciously prosecuted him by filing a lis pendens in connection with a Colorado Uniform Fraudulent Transfer Act ("CUFTA") claim, without achieving a favorable termination of the underlying action.

Summary of the Judgment

The Colorado Supreme Court affirmed the decision of the Court of Appeals, holding that a lis pendens does not constitute an ex parte action and, therefore, is not exempt from the requirement of favorable termination in a malicious prosecution claim. The Court also declined to adopt a totality-of-the-circumstances test for determining favorable termination in such cases. Consequently, Hewitt's malicious prosecution claim was dismissed because the underlying lis pendens action did not terminate favorably in his favor.

Analysis

Precedents Cited

The Court extensively referenced several key precedents to shape its decision:

• Thompson v. Maryland Casualty Co.: Clarified that lis pendens can form the basis of a malicious prosecution claim but must conclude with favorable termination.
• Westfield Development Co. v. Rifle Investors Association: Emphasized that malicious prosecution arising from a main action typically cannot be pursued as a counterclaim without favorable termination.
• LOUNDER v. JACOBS: Supported the necessity of favorable termination in malicious prosecution claims.
• JOHNSTON v. DEIDESHEIMER: Established that liability can attach for filing notices of lis pendens if damages are sustained.
• WALFORD v. BLINDER, Robinson Co.: Held that malicious prosecution claims based on lis pendens require favorable termination, rejecting the ex parte exception.

Additionally, the Court considered the Restatement (Second) of Torts sections 660 and 674, particularly comment k, which discusses exceptions to the favorable termination requirement. However, the Court concluded that lis pendens under Colorado law do not fall within this exception.

Legal Reasoning

The Court meticulously analyzed the nature of lis pendens, determining that it functions solely as a notice of pending litigation and does not grant any form of relief without an opportunity for the opposing party to be heard. This characteristic precludes lis pendens from being classified as ex parte proceedings under the Restatement’s comment k. Consequently, the requirement of favorable termination remains intact for malicious prosecution claims involving lis pendens.

Moreover, the Court rejected Hewitt's proposition to adopt a totality-of-the-circumstances test, emphasizing that settlements do not equate to favorable termination. The Court underscored traditional principles that reinforce the need for a claim to be resolved on its merits in favor of the plaintiff to satisfy the elements of malicious prosecution.

Impact

This judgment solidifies the stringent requirements for bringing forth a malicious prosecution claim in Colorado, especially in cases involving lis pendens. By reaffirming the necessity of favorable termination and rejecting a more flexible totality-of-the-circumstances approach, the Court ensures that the tort of malicious prosecution remains a narrowly tailored remedy. This decision discourages baseless litigation tactics and reaffirms the protection of litigants against unfounded legal actions.

Complex Concepts Simplified

Malicious Prosecution

A tort that allows an individual to sue another for initiating a legal action against them without probable cause and with malice, resulting in harm.

Lis Pendens

A legal notice filed in public records indicating that a property is subject to pending litigation, thereby warning potential buyers or financiers of the dispute.

Favorable Termination

The requirement that the preceding legal action must conclude in favor of the plaintiff (the person bringing the malicious prosecution claim) for the tort to be actionable.

Ex Parte Proceedings

Legal actions conducted with one party without giving the opposing party an opportunity to be heard or present their case.

Totality-of-the-Circumstances Test

A proposed approach where all relevant facts and circumstances are considered collectively to determine whether an underlying proceeding ended favorably.

Conclusion

The Colorado Supreme Court's decision in HEWITT v. RICE reinforces the essential elements of malicious prosecution within the state, particularly emphasizing that lis pendens filings do not qualify as ex parte actions. By mandating a favorable termination of the underlying action, the Court ensures that only well-founded claims can pursue malicious prosecution remedies. This judgment upholds the integrity of the legal process, discourages misuse of litigation strategies, and provides clear guidance for future cases involving similar legal issues.